In today's economy, lenders have changed their lending requirements as times have become worse. Many Americans are struggling to stay afloat with their normal bills and salaries and wages that aren't rising. Additionally, many people have been laid off or fired because of employers either cutting back or going out of business. The blue chip companies of yesterday, Ford, GM, General Electric have seen their stock prices fall to new lows. High flying companies such as Starbucks are closing old non producing stores and reevaluating their future expansion plans. Federal back government agencies such as Freddie Mac and Fanny Mae have financial problems due to eroding lending portfolios and are now being assisted by the Federal Reserve...What does this all mean to getting financed in the commercial vehicle and construction industry....



Because banks recognize first hand that the U.S economy is in trouble, they have tightened their lending requirements in all industries. Many lending programs that were available yesterday are gone or changed dramatically that many potential customers will not qualify. Rates of interest charged by these lending institutions have jumped and more down payment money is required to start any lending program....The seasoned and startup business now must look at other alternatives in obtaining financing. Today, very few people have A+ Credit and must adjust their thinking based upon the times.

One of the unique facts that has occurred during this economic recession is the large number of repossessions and foreclosures. Banks are taking back homes, commercial trucks and heavy construction equipment back by the droves. These lending institutions must recondition these foreclosed and repossessed items and get them back into revenue income producing stream ASAP. Every day that these items that are sitting on the financial institutions books are another day they are losing money..

Obviously as financial institutions have tightened up their lending requirements for normal business, many people will not qualify for a new loan/or lease. As lenders have absorbed huge volume of repossessions, they have come up with alternative financing to get them back into their revenue stream.

For Americans that don't have good credit, very little money available for a down payment or little or no time in business, these bank repossessions have created an opportunity for many. Prior Bankruptcies within seven years for many lenders are no longer a major stumbling block for the potential customers as long as credit has been reestablished. Today, lenders will look at Customers that have credit as low as 600 and into the 500s with special provisions. The market place today will offer customers as low as nothing down to deferred payments for 60-90 days on selected inventories.. Some lenders will even ignore the credit scores as long as the customer has healthy cash balances in the bank or a story to tell to explain past problems away. If you have terrible credit and very little money available down, some lenders will consider a financing arrangement as long as you have adequate additional collateral to put up such as other equipment, vehicles or real estate. Time in business and other mitigating factors that precluded you from a prior opportunity are now eliminated.

The types of items to be get financed in the above paragraphs are the following:

Dump trucks, garbage and water trucks, day cabs, over the road and semi trucks, boom trucks, box vans, bucket trucks, articulated trucks, concrete and cement trucks, fuel trucks, excavators, backhoes, bulldozers, forestry equipment, concrete pumps and concrete equipment, tow trucks, septic trucks, end and bottom dump trailers, flatbed and dry van trailers, etc

Many lenders have application only programs that don't require financial statements, tax returns or bank statements. These financing programs could lend as much as $250,000 for seasoned businesses. Available credit on other repo programs could run as high as $100,000 for a startup business. Some lenders may require full documentation packages which shouldn't be a hardship for a person that can now get into the financing arena.

There are many alternatives in the market place, once you understand that normal lending probably isn't your answer. In the repo market, credit is always important but not always the answer to everything. You have the ability to shop price and financing. Startup as well as seasoned businesses have any opportunity to acquire commercial trucks, heavy equipment and commercial trailers. The down payments, financing length, regardless of age, and terms may be more flexible than you think. Startup businesses have a good opportunity to enter this market and not have to put 20-30% down, regardless of credit.

This is possibility a win-win situation both for the lender and the potential customer, whether startup or seasoned.

Happy hunting for your acquisition.